Packwood: Bermuda Is Ally, Not Tax Haven
“As a small island nation, with a vibrant insurance sector and relatively low tax rates, Bermuda can be a target for political leaders and pundits in the United States. But history shows that our nations are natural friends, allies and economic partners,” Cheryl Packwood noted in an article for The Hill.
Ms. Packwood — the Director of the Bermuda Government’s Washington, DC Office — noted that “during the Cold War and the current war on terror, Bermuda provided the US with bases for Air Force refueling and aircraft searching for enemy submarines in the Atlantic.”
She continued on to say, “Over the last 12 years alone, Bermuda’s insurers and reinsurers have contributed an estimated $35 billion in catastrophe claims payments to their U.S. clients.
“These payments have included $2.5 billion after the destruction of the World Trade Center, $17 billion for Hurricane Katrina, $2 billion following tornado outbreaks from 2010 to 2012 and an estimated $3 billion in reported losses by Bermuda’s reinsurers for Hurricane Sandy.”
Ms. Packwood concluded her article by saying, “The next time American politicians and the news media lump Bermuda together with “tax havens,” remember the facts: Bermuda is committed to international cooperation on matters from taxation and regulation to hemispheric defense. An alliance forged in the flames of international conflict should not be sacrificed on the altar of domestic political expediency.”
You can read the full article — entitled “Bermuda is an ally, not a tax haven” — here on TheHill.com.
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What a crock..
“The next time American politicians and the news media lump Bermuda together with “tax havens,” remember the facts: Bermuda is committed to international cooperation on matters from taxation and regulation to hemispheric defense. An alliance forged in the flames of international conflict should not be sacrificed on the altar of domestic political expediency.”
I want to thank you Ms. Packwood for, “calling a spade a spade”
All the Premier has to do is go on CNN,FOX,& MSN and explain to the World the Truth.
I know arrangements can be made. – I know for sure that the Premier has a good wealth of knowledge on this topic.
Not a tax haven…
Riiiight
Ever since Bob Richards tried to throw Paula Cox and the PLP under the international term limit bus by siding with Mckeeva Bush and the Cayman Gov. We’ve had to defend our business model … Bob dug the hole and now he must refill it .
More nonsense coffee???? Why don’t you take a break???
Thank you MS Packwood, for stating the real facts, you were definitely a good choice by the OBA for appointing you to the position you have!!
One day the majority of Bermudians will realize after they actually do some research concerning US politics, that the democrats are NOT our friends and will throw us under the bus the first chance they get for votes!!!! The Republicans who thankfully have control of the US congress ( and soon to be the Senate ) know how important Bermudas roll is in saving Americans money on their insurance costs!!!! But it never ceases to amaze me at the level of stupidity this island produces when it comes to supporting Obama and his democrats?????
72% Of Americans Disapprove Of Republicans In Congress
http://www.huffingtonpost.com/2014/09/14/republicans-approval-rating-congress-gop_n_5820130.html
The Huffington Post is one of the worst examples of agenda-driven media bias. What they did was take the results of this Poll, and insert the word “Republicans” into it. The actual Poll was “Disapprove of Congress”. Congress is made up of the Senate (controlled by Democrats) and The House (controlled by Republicans).
What makes this Huffpo interpretation of this Poll even more absurd is that Republicans are expected to regain control of the Senate in the forthcoming midterm elections. So much for Huffpo’s reporting.
@Decian, thank you!!! Famous is exactly what I was talking about when I referred to the level of stupidity in this island and also the lack of research!!! They blindly listen the the likes of the huffington post, cnn, nbc and cnbc and take it for gospel??? They need to wake to heck up because if the Dems had it their way we would lose 85% of our income and starve to death!!! Blind following the blind in this island unfortantley?????
It is even sadder when you realize it is not only the plper’s that support them, it also is the vast majority of the OBA government and its supporters as well???
Hahaha.
Huffington Post is about as impartial as the likes of the Worker’s Voice, MSNBC, FOX or your opinion pieces!
I don’t care about Republicans or Democrats, but it is not hard to pick out the inherent biases in all media nowadays as they don’t tend to hide it.
And HuffPo leans so far in one direction they need a kickstand just to stop from falling over!
If the Island is NOT a Tax Haven… Then why are ALL these IB company’s based here??? It’s NOT “rocket science”!! They did NOT come here for their health – ONLY financial health and to save paying very BIG $$$ to *Uncle Sam* AKA the US Treasury!!!
The term tax haven conjures up images of backhanded deals and money laundering, and for Bermuda to be labelled as such is unfair. Bermuda has certain tax advantages, perhaps, but it’s politically expedient for the likes of Al Franken and others to blanket the country as such, versus instead trying to get their own affairs in order.
-World class Insurance regulation,
-Quick to market,
-Industry infrastructure established market,
-Companies could go elsewhere and pay less effective tax on worldwide ops,
-Companies do pay tax on their US operations in the US and pay tax on any distributions from their US operations too.
In debt we will never be able to repay, while IB collectively makes over 10 times our GDP in profits straight through the “recession”.
Dear Make My Day,
Judging by your comments, you obviously do not understand the difference between tax avoidance and tax evasion.
Per the OECD’s definitions:
Tax Avoidance – generally used to describe the arrangement of a taxpayer’s affairs that is intended to reduce his tax liability and that although the arrangement could be strictly legal it is usually in contradiction with the intent of the law it purports to follow.
Tax Evasion – generally used to mean illegal arrangements where liability to tax is hidden or ignored, i.e. the taxpayer pays less tax than he is legally obligated to pay by hiding income or information from the tax authorities.
Tax Haven – in the “classical” sense refers to a country which imposes a low or no tax, and is used by corporations to avoid tax which otherwise would be payable in a high-tax country. According to OECD report, tax havens have the following key characteristics; No or only nominal taxes; Lack of effective exchange of information; Lack of transparency in the operation of the legislative, legal or administrative provisions.
With respect to Bermuda, tax is not levied on earnings of local or exempted companies, but both have to pay an annual company fee in line with their capital. This means we do meet 1 of the criteria which determine whether a country is classed as a haven. However Bermuda has taken tremendous steps to ensure there is effective exchange of information via numerous TIEA’s and transparency in the operation of the legislative, legal and administrative provisions. Hence the reason we are not classed as a tax haven on the OECD list.
In my opinion, if a company has a physical presence in a country and sells goods/services from that country, any earnings generated in the locale should be subjected to the local rate of tax whatever that may be! The world does not operate on a “one size fits all”template, nor should it. The US model operates on the belief that the government is entitled to charge tax on any US domiciled company’s WORLDWIDE earnings!!! How the heck is that fair, equitable or even justifiable? It is a poorly written and interpreted application of an archaic system in desperate need of revising.
Most corporations are beholden to their shareholders to produce a return on their investment, which means reducing their spend as they see fit with prudent fiscal management. To some people, this means changing their corporate domicile to a country where the tax laws are more favourable. This is not illegal, although arguably there are some unscrupulous companies who will use such a jurisdiction to evade tax.
So yeah, some may be in Bermuda for their financial health, but so what! That in and of itself does not make them tax evaders or Bermuda a tax haven.
Ms.Packwood , we all agree with the argument proffered by Bermuda . However, how do you explain the presence of Google in Bermuda ? Is Google selling insurance products in America ?
Don’t they have a structure through Ireland ? So why aren’t they attacking Ireland?
Okay wealthy people and corporations funnel money through Bermuda, to advoid paying said taxes in their jurisdictios. Are we proud of what we do.
Wow you really hate Bermuda Rhonda, how many posts to try and smear our Name.
Much of the money earned by Companies worldwide operations is NOT earned in the US. So why should a company have to pay more tax on those earning to the US ?
FATCA and our tax sharing agreements cover wealthy individuals.
Does our government have on clothes, or are we all being hoodwinked into just belive.
Many years ago there lived an emperor who cared only about his clothes and about showing them off. One day he heard from two swindlers that they could make the finest suit of clothes from the most beautiful cloth. This cloth, they said, also had the special capability that it was invisible to anyone who was either stupid or not fit for his position.
Being a bit nervous about whether he himself would be able to see the cloth, the emperor first sent two of his trusted men to see it. Of course, neither would admit that they could not see the cloth and so praised it. All the townspeople had also heard of the cloth and were interested to learn how stupid their neighbors were.
The emperor then allowed himself to be dressed in the clothes for a procession through town, never admitting that he was too unfit and stupid to see what he was wearing. For he was afraid that the other people would think that he was stupid.
Of course, all the townspeople wildly praised the magnificent clothes of the emperor, afraid to admit that they could not see them, until a small child said:
“But he has nothing on”!
This was whispered from person to person until everyone in the crowd was shouting that the emperor had nothing on. The emperor heard it and felt that they were correct, but held his head high and finished the procession.
The problem, Rhonda, is that you have no idea what you’re talking about.
By the look of it you just enjoy being anti-Bermudian.
A rose by any other name is, ubp, no oba, no a safe place for tax dodgers, ops its still a rose
Rhonda give it a break.
Bermuda definitely needs to go on the offensive in cases like this – and the same sort of message must be hammered home in the UK via the press and meetings with the three parties, before G8 summit meetings, before meetings of EU leaders etc etc.
We need personal lobbying as well as good articles strategically placed in the right media
The Emperor has no clothes
Rhonda, it is US politicians leveraging ‘easy’ votes, by only identifying a tiny piece of the puzzle.
The reinsurance industry allows their consumer insurance cost to be significantly lower.
The US based operations do pay tax on their profits.
Please can the same politician explain why they are not attacking the state of Delaware and their tax regime?
Meanwhile we are paying extremely high insurance rates here.
Why can we not recieve the benifit of low insurance costs?
After all we save these foriegn companies millions help their customers pay less. Yet most of us have to pay these exorbitant bermuda insurance rates. And what about our constantly rising tax burden? No tax haven for us.
You are confusing reinsurance business (i.e. IB) that Ms. Packwood is adressing with primary insurers (i.e. Argus, BF&M, Colonial etc.) who are all locally formed and domiciled businesses.
Jeremy – the reason why jurisdictions like ours do not go on a media offensive is the scrutiny it will no doubt attract – the revelation will undoubtedly be that we are a “Tax Haven” – however replete with all the fancy bells and whistles that allow these “tax dodgers” to sleep well at night.
Lets enjoy it while it lasts shall we?
The Bermuda based insurance companies are under fire for the way they transfer business to their offshore subsidiaries and companies like Goggle etc are based in jurisdictions like Bermuda where they pay no tax to the US despite having few,if any personnel here….how are we not a tax Haven?
We’re a tax haven, but to be honest that’s not our problem. Our problem is the fact that the companies don’t employ enough Bermudians.
shh…they don’t like that!
Honestly…we do have money that we run through and reintroduce to the economy,in fact it all comes from a 7year delay like aged wine…yes indeed ,we have time travellers who visit regularly and bring us money from decades ago up till seven years making it all above board and legal, statute of limitations and all that…..The time travellers have learned how to distort and fold the time continuum….and…welll they visit you too but we have a buisness relationship with them…
@ Rhonda Neil who buys your clothes…….Stevie Wonder?…The most interesting information comes from children…..for they tell all that they know and then stop.
Cheryl Packwood is a highly experienced and skilled advocate, representing the best interests of all Bermudians. The points made by her in her article are very well stated and should be taken in by all.
It’s alright for a certain segment of Bermudians and foreign born status Bermudians to call other Bermudians lazy , but they jump up and down screaming and throwing tantrums when the Americans call us a tax haven .
When France called Bermuda a tax haven , everything French was bad .
Dr.Brown set up a office in Washington D.C. for the specific purpose of the lobby . The then combined opposition NEVER GAVE HIM CREDIT ! Who is using that office today ? Where is Bob Richards ? What diplomacy is the perfect Gov. Of Bermuda employing to stave of this threat to our survival ?
How long can Bermuda stay in the “stealing from the rich to give to the rich business ?”
Bermuda is bankrupt in the political arena ! We have no real politicians ! We have a Micheal Dunkeley (amateur)and as Ed Christopher rightly called Jeff Baron ..Mini Me … Haha !
As long as the entitled ones continue to call the workers of this country lazy , than , when others call us as a country a tax haven , the majority of Bermudians will remain silent , simply because we will not defend people who will never defend us ! Even if it is to our own detriment … We will all sink together as there is no love to bind us !
France reversed their position following discussions
Keep it real, you will NEVER get any credit from the Government for the foresight of EFB, but then he did NOT open these offices (London and Washington) to deal with the tax problem, but as a prelude to independence. And to digress slightly – keep your eye on the Scotiitsh referendum on independence – it is a positive example to Bermuda. 97% of eligible voters have registered to vote in this referendum.
Rather than keeping political score cards, focus on Bermuda’s reputation, on how “we” can pull our reputation out of the pit of lost tax revenues for all countries that are reeling from their tax shortfalls; a defeceit nightmare for these countries.
Ms Packwood is doing her job admirably, taking the argument to those who matter – the politicians in both Houses of representatives of the United States. By placing her arguments in periodicals, newspapers magazines, etc that specifically target the audience that matter we may see some movement in a positive direction.
Ms Packwood should head both the London and Washington offices thereby cooridnating our counter-defence to tax haven in both Washington and London.
But at the end of the day when these countries lose badly needed tax revenue to fund their social programmes and wars, being an “alley” does not cut the mustard, terrorism needs to be fought, and wars need to be funded. The US and UK can call upon their companies to come back home not only on tax grounds but for their vital national security interests, and patriotic companies will respond.
Final thought, it is most likely that France, US and UK will very reluctanty be drawn into a targeted regional war with IS, how it plays out will have an effect upon companies in tax havens.